Introduction

Intellectual property rights form the backbone of innovation-driven economies. Patents, trademarks, copyrights, and trade secrets incentivise businesses and individuals to invest in research, creativity, and development. When these protections are weak or inconsistently enforced, it creates uncertainty for companies operating across borders and that uncertainty has real economic consequences.

Each year, the United States Trade Representative publishes the Special 301 Report, a comprehensive review of how countries around the world protect and enforce IP rights. Countries identified as falling short are placed on either a Watch List or the more serious Priority Watch List. For 2025, India has once again found itself on the latter a designation it has held for several consecutive years. It shares this status with several other countries, including China, Russia, Indonesia, Argentina, and Venezuela.

The inclusion is not merely symbolic. The report signals that the US considers India's IP environment to be among the more challenging of any major economy and it sets the tone for ongoing trade negotiations and diplomatic engagement between the two countries.

A Mixed Record on IP Reform

To be fair to India, the 2025 report does acknowledge that the country has not been entirely inactive on the IP front. Efforts have been made to raise public awareness about the importance of intellectual property, and the level of engagement between Indian and American officials on these matters has reportedly increased over the past year.

Indian IP offices have also undertaken procedural improvements aimed at streamlining operations. These are steps in the right direction, and the report acknowledges them. However, acknowledgement is not the same as satisfaction. The overarching assessment remains that India's overall approach to IP protection is inadequate, and that structural issues continue to persist despite incremental improvements.

The Patent Problem

Among all the IP-related concerns raised in the report, patents emerge as the most pressing. Several issues have been flagged that affect companies across a wide range of sectors from pharmaceuticals and biotechnology to technology and manufacturing.

One significant area of concern relates to the possibility of patent revocations. Businesses that have invested considerable resources in developing and registering patents in India face uncertainty around such risks, creating instability in an already complex environment. Compounding this is the manner in which patentability criteria under Indian patent law are applied. Stakeholders have expressed concerns that the criteria are interpreted in ways that leave room for unpredictable outcomes, making it difficult for companies to forecast results when filing applications.

The process itself is also a source of frustration. Patent applicants routinely face long waiting periods before receiving a grant, and the reporting requirements placed upon them are considered excessive by international standards. Industry stakeholders have repeatedly pointed to vagueness in how parts of the Indian Patents Act are interpreted, calling for greater legal clarity and predictability.

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An Apparent Inconsistency in Policy

One of the more notable observations in the report concerns what it suggests may be an inconsistency in India's approach. Indian authorities have often justified limitations on IP protections by arguing that stronger protections would restrict public access to essential technologies particularly in sectors like healthcare and renewable energy.

However, the report notes that India simultaneously imposes high customs duties on many IP-intensive products, including pharmaceuticals, medical devices, information and communications technology equipment, solar energy products, and capital goods. The report raises both points in proximity, and analysts have observed that these positions may be difficult to reconcile. As stakeholders have noted, tariffs of this nature can themselves raise costs and limit access a dynamic that sits uneasily alongside the access-based rationale for limiting IP protections.

The Road Ahead

Despite the critical tone of the report, it stops short of severing dialogue. The US has expressed its intention to continue engaging with India on IP matters through the Trade Policy Forum's intellectual property working group, suggesting that the relationship remains one of negotiation rather than confrontation.

 Conclusion

India's continued presence on the Priority Watch List reflects a broader tension between its domestic policy priorities and its obligations and relationships within the global trading system. While India has made some progress, the gap between what is expected and what has been delivered remains significant. For businesses operating in or looking to enter the Indian market, this serves as a reminder that IP risk management must be a central part of any strategy. And for policymakers on both sides, it underscores the need for sustained, good-faith engagement to resolve concerns that have lingered for several years.