Globalisation Outsourcing-Emerging Opportunities for IPR Interactive Conference on

Globalisation: Outsourcing-Emerging Opportunities for IPR Interactive Conference on Doing LPO Business in India 22 nd April 2007 Le Meridian, Andheri East, Mumbai Dr. D. R. AGARWAL (Director) ITAG Business Solutions Ltd.

WHAT IS GLOBALISATION? Globalisation is an ‘Umbrella’ term defined precisely by IMF as the The first era of globalisation growing economic interdependence of FREE (1850 – 1945) was OF GOODS countries MOVEMENT Paxthrough worldwide Britannica increasing volume and variety of under ‘gold standard’ and the FREE ‘cross-border’ transactions in World second phase (post second goods MOVEMENT GLOBALISATION OF and services, ‘free international War) is Pax Americana under. OF CAPITAL capital flows’ and more rapid TECHNOLOGY and ‘Bretton Wood System’ widespread diffusion of technology. FREE MOVEMENT OF SERVICES 3/18/2018 2

Final Act WTO AGREEMENTS AGREEMENT ESTABLISHING WTO ANNEX IA TRADE IN GOODS GATT 1994 + TWELVE AGREEMENTS 3/18/2018 ANNEX IB TRADE IN SERVICES ANNEC IC TRADE IN INTELLECTUAL PROPERTY RIGHTS 3

World Population & GDP 2005 (Unequal World) Population in Million (in %) World USA EU-25 China Japan India 6438 297 460 1307 128 1103 100. 0 4. 61 7. 15 20. 30 1. 99 17. 13 GDP – US$ Bn GDP (%) GNI-$ (PPP) 44385 12455 13446 2229 4506 785 100. 0 28. 06 30. 29 5. 02 10. 15 1. 77 55167 11190 11724 8182 3911 3433 Source: World Development Report 2007, World Bank and World Fact Book, 2005 USA 3/18/2018 4

Sectoral Analysis Of GDP (2004) WORLD US JAPAN CHINA INDIA MANUFACTURE 28 22 31 46 28 AGRICULTURE 4 1 1 13 19 68 77 68 41 53 SERVICES Source: World Development Report 2007 3/18/2018 5

World Trade In Goods And Services (2005) US$(Million) Percentage Trade in Goods 10120 80. 7 Trade in Services 2415 19. 3 Total 12535 100. 0 3/18/2018 Source: World Trade Report 2006 6

Why Globalisation New opportunities to developing countries Greater access to developed country markets Technology transfer lead to improved productivity Higher living standard

Tools of Globalisation Outsourcing Globalisat ion IT 3/18/2018 8

Genesis of Outsourcing • No country is self-sufficient in a resource • In-house in-capabilities is one of the causes for outsourcing • Lack of highly skilled domestic engineering and technology labour • Consumers are the king, they drive the business. • Globalisation is a win-win situation for all countries involved • Comparative advantage is a driver of globalisation 3/18/2018 9

Innovation Outsourcing Services Outsourcing Production Outsourcing 3/18/2018 10

Mode of Services under GATS Supplier Presence Other Criteria Mode Service supplier not present within the territory of the Service Consumer Service delivered within the territory of the Member from the territory of another Member (e- Commerce, BPO) MODE 1 - CROSSBORDER SUPPLY Service delivered outside the territory of the Member, in the territory of another Member, to a service consumer of the Member MODE 2 CONSUMPTION ABROAD Service delivered within the territory of the Member, through the commercial presence Branch Office etc. MODE 3 COMMERCIAL PRESENCE Service delivered within the territory of the Member, with supplier present as a natural person on temporary basis MODE 4 - MOVEMENT OF NATURAL PERSON Service supplier present within the territory of the Service Consumer 3/18/2018 11

Economic Resources 3/18/2018 12

• Relocation of business processes from one country to another • Picking services within a country Offshoring Inshoring Siblings of Outsourcing Outsourcin g • Movement of internal business processes to an external company 3/18/2018 Nearshorin g • Relocating of business processes to lower cost foreign location but in close vicinity 13

MERITS FOR OUTSOURCER Progeny of savings and efficiency Streamlines the business Increases insourcing within the country Conducts business across multiple time zones The key to global village 3/18/2018 14

MERITS FOR OUTSOURCEE Job Opportunities Education 3/18/2018 Increased Wages Quality of Life 15

India’s position in outsourcing 3/18/2018 16

Decision Making Model for Outsourcing Know exactly Determine least which process strategic value to outsource process 3/18/2018 Stock taking before implementing Gear up for long term commitment 17

Challenges • Data Security • Attrition • Training Staff • Infrastructure Investments • Recruiting staff 3/18/2018 18

Emerging Opportunities for IPR 3/18/2018 19

Total Wealth, 2000 - $ per capita & percentage shares Source: World Bank Study 3/18/2018 20

Various types of IPRs Minimum standards as per TRIPs Type of IPRs Subject Matter Duration of Protection Patent (Paris Convention, 1883 refers to New, Non-Obvious 20 Years from the date Stockholm Act of 14. 7. 1967). Patent (Invention) & Industrial of Filing Law Treaty & Patent Cooporation Treaty Applicability Copyrights & Related Rights (Berne Convention, 1886, Paris Act of 24. 7. 1971) (Rome Convention recognised on 26. 10. 1961) Authorship, Artistic Performance, Phonogram & Broadcasting Life of the Author plus 50 Years(India 60 yrs) Trade/Service Marks Signs or Symbols to Identify Goods & Services 7 Years from Initial Recognition & for each Renewal (Indefinite) Industrial Designs Ornamental, designs for Clothing, Automobiles, Electronics etc 10 Years Integrated Circuits & Layout Design (Washington Treaty recognised on 26. 5. 1989) Original Layout Designs 10 Years 3/18/2018 21

IPR Services • • • • Mergers & Acquisition – IPR Audit IPR Valuation Inventory of the Company’s IPR Portfolio Analysis Financial Reporting Diligence of Investors IP Watch Patent Claim Mappings R & D Taxation Credit Support Document Writing Prior Art Search Patentability Patent Application Drafting & Filing 3/18/2018 Licensing of IPR 22

Transfer of IP IP Securitisation Opportunities in IPR? IP in Tax Planning IP Insurance 3/18/2018 23

WORLDWIDE PATENT FILINGS 3/18/2018 24

PATENTS GRANTED WORLDWIDE 3/18/2018 25

TOP 20 OFFICES OF FILING 3/18/2018 26

RESIDENT PATENT FILINGS PER MILLION POPULATION 3/18/2018 27

PATENTS GRANTED BY OFFICE 3/18/2018 28

Investments in R&D by American Companies as a Percent of GDP, 1953 -2000 3/18/2018 29

Assuming IP Protection constant – Increase in rents of IP protected labor – Decrease in the rate of innovation Scarcity of Patent Agents Increasing market size & specialisation Corruption Challenges in IP Industry Growing protectionism In outsourcing companies 3/18/2018 Attrition Lack of Coverage for liability and risk 30 Source: Intellectual Property in a Global Economy – Michele Boldrin, David K. Levine

Future is Outsourcing • A new way to leverage skills and markets • Win-win situation: for DCs and ICs: productivity, competitiveness, higher employment, faster economic growth – every dollar of outsourcing creates $1 -45 -1 -47 of value of which the US captures $1. 12 -1. 15 while India gets only 33 cents • Outsourcing ‘industry’: to exceed $1 trillion by 2006 • Total savings from global outsourcing: – to grow from $6. 7 bn (2003) to $20. 9 bn (2008) Developing countries’ gains: $60 billion in ITES by 2008 3/18/2018 31

Tomorrow’s slogans • Tomorrow’s societies will be knowledge societies. • Tomorrow’s markets will be knowledge markets. • Tomorrow’s wars will be fought with the new thermonuclear weapons called information and knowledge. Every Indian trying to be a Knowledge worker 3/18/2018 32

Business Opportunities… Visibility !!! Strong potential…. there is need for visibility Only the tip of the ice berg can be seen …there lies a huge potent mass to be explored 3/18/2018 33

Who will Survive? Darwinism “It is not the strongest of the species who survive, nor the most intelligent, but those who are most adaptive to change…” -Charles Darwin 3/18/2018 34

THANK YOU 3/18/2018 THE JOURNEY NEVER ENDS 35