New Delhi: India will launch a formal dispute against the European Union (EU) at the World Trade Organization (WTO) over EU seizures of Indian generic drugs, a senior trade ministry official said on Tuesday.
Settling the dispute could take 12-18 months, another ministry official, who deals directly with WTO issues, told ‘Reuters’.
New Delhi says it wants to solve the dispute “amicably” but there has been no break-through so far between India and its largest trading partner.
“As far as we are concerned, it’s a violation of TRIPS (Agreement on Trade Related Aspects of Intellectual Property Rights) and needs to be taken to the WTO,” the senior trade ministry offical said, referring to the international trade agreements.
“(The) pharma issue will go to the WTO. India is not satisfied by what is happening in the European Union,” the official said.
A formal trade dispute has loomed for a long time between India and Brazil on one side and EU on the other.
Growing market: A Dr Reddy’s plant in Andhra Pradesh. Global demand for generic drugs from Indian firms has been booming. Bloomberg
Developing countries believe the case, originally involving the seizure by Dutch customs of a blood pressure drug en route from India to Brazil, is a symbol of their mistreatment by rich nations and corporations.
According to WTO procedure, the case now moves to the WTO’s dispute settlement mechanism for a solution.
India has said the drug shipments were consistent with WTO regulations. The issue is sensitive in a country with a thriving generic drugs industry with hundreds of millions of poor needing access to cheap medicine.
The move comes despite an earlier statement by the European Commission that EU had taken the drugs seizures “very seriously” and implemented measures to prevent further incidents.
“We take this positively,” P.V. Appaji, executive director of the Pharmaceuticals Export Promotion Council, said. “They (the drugs) are going to countries where they have approved the products for imports. That is clear. This is just denying access to generic medicines of affordable prices to the developing world.”
Global demand for generic drugs from Indian drug makers such as Dr Reddy’s Laboratories Ltd, Ranbaxy Laboratories Ltd and Cipla Ltd is booming as nations battle rising health care costs.
The Indian generics business boom has lured Western drug makers that want to raise exposure in fast-growing emerging markets.
“It is about time. This should have been taken up a long time ago,” Cipla joint managing director Amar Lulla said.