MUMBAI - If Captain Jack Sparrow of the
Pirates of the Caribbean film trilogy were
operating his funny business in the 21st century,
his loot would be pirated compact discs, digital
video discs, books and software, with his schooner
based near an Indian Ocean island.
Losing
a mind-jerking US$29 billion annually in
intellectual-property theft from counterfeiting
and piracy, India is ironically among both top
victims and victimizers of piracy that robs
the
creativity industry of between
US$600 billion and $650 billion a year.
The music industry is a favorite target
for pirates, with India suffering losses of nearly
$440 million in the past three years. Rajindar
Bhatia, a senior legal adviser to the Indian music
industry, says that nearly one-third of music sold
in India is illegal. "Music piracy has taken
the shape of an organized crime," he said, "which
unchecked can kill the industry, like it has in
Malaysia and Bangladesh."
The piracy-loss
numbers were hurled out of a workshop marking
World Intellectual Property Day (April 26) in New
Delhi organized by the Federation of Indian
Chambers of Commerce and Industry (FICCI) and
National Academy of Customs, Excise and Narcotics
(NACEN).
Vanaja Sarna, additional director
general of NACEN, told the media that piracy is
making a huge dent in the economy. She also quoted
a recent Interpol study that found piracy funds
drug trafficking and terrorism. Senior US customs
and border-enforcement officials were present to
share their experiences.
The workshop
included briefings on ways to strengthen customs
practices to nab counterfeiters and pirates.
India's Customs Act, enacted in 1962, is yet to
adopt the model legislation proposed by the World
Customs Organization to empower customs officials.
The Associated Press on April 30 reported
that the US government was placing India and
Thailand among 12 countries on a "priority watch
list" as countries that seriously violate
intellectual-property rights. Russia, China,
Argentina, Chile, Egypt, Israel, Lebanon, Turkey,
Ukraine and Venezuela were among the dozen
countries mentioned in the annual "Special 301"
report issued by the office of the US Trade
Representative on the efficiency of
intellectual-property protection by US trading
partners.
"We must defend ideas,
inventions and creativity from ripoff artists and
thieves," Trade Representative Susan Schwab said
in a statement attached to the report.
The
Indian government is making more serious efforts
to fight the pirates. Ajay Dua, secretary of the
Department of Industrial Policy and Promotion,
said in a seminar on "Counterfeiting and Piracy"
to mark World Intellectual Property Day that an
inter-ministerial group had been set up to find
more effective ways to fight piracy.
''As
a result of such piracy," Dua said in the seminar,
"the costs are ultimately passed to consumers,
governments are deprived of tax revenues, jobs are
lost, and much research and innovation never
happens." Dua said laws are adequate, but the
problem is in enforcement, with an overworked
police force putting chasing pirates low on their
list of priorities.
India, like Hong Kong
and mainland China, has serious problems defending
against idea bandits, with entire factories spread
across the country churning out fake goods.
Intellectual-property rights are worst hit with
pirated versions of big-budget Indian movies in
circulation before their release.
Major
music-industry pirates have also established their
own labels funded from their pirated loot, gaining
a legal front both to piracy and money-laundering.
In 1997, Gulshan Kumar, owner of leading Indian
music company Super Cassettes, was gunned down in
broad daylight outside a temple in Mumbai
allegedly by hired hit men because of his
involvement in music piracy, to the extent of
music companies accusing him of destroying the
recording industry.
With low levels of
police enforcement, pirated goods are publicly
displayed without any shame across Asia. A common
sight in major Indian cities is rickety wooden
benches or plastic sheets on roadsides piled high
with pirated Harry Potters and other
best-sellers, technical and management books, and
fake video and audio discs sold at about one-sixth
the cost of originals.
Enforcement
officials are increasingly worried that the global
pirated-goods trade is becoming more profitable
and safer than narcotics and that, inevitably,
terrorist organizations are entering the
fake-goods industry to generate easy funds.
Without effective anti-piracy laws and
enforcement, music and movie pirates can continue
to enjoy greater loot with the Indian
entertainment industry posting 20% growth in 2006.
A viewpoint in the piracy debate offers
that music pirates appear because original music
products are too expensive. Cheaper legally
available products would dent illegal products,
according to one anti-piracy school of thought.
Technology, though, is keeping ahead of
lawmakers and enforcers, with mobile music piracy
now adding to industry woes. A study of the global
music industry in 2006 released recently by the
International Federation of the Phonographic
Industry (IFPI), a London-based recording-industry
body representing 1,400 companies in more than 70
countries, said mobile music in Asia is growing
faster than online music services.
"Penetration of music-capable phones in
Asia is also the highest in the world," the IFPI
study said. The mobile music market in Asia
Pacific will reach $9.3 billion by 2010, Business
Wire reported last October.
Ringtone
piracy is rampant in the Asia-Pacific region,
according to the Paris-based International
Confederation of Authors and Composers Societies
(CISAC). Japan, South Korea, Singapore and
Malaysia make the best efforts to rein in ringtone
pirates, rates the CISAC, while Thailand and the
Philippines are the worst offenders. Ringtone
piracy, though rampant in India, is not yet a
law-enforcement issue.
Chinese courts have
taken stricter action against music pirates, with
a Beijing court last month ruling against
Yahoo.com in a music-piracy case filed against it
by 11 recording companies, including Warner Music,
Sony BMG and EMI. In 2005, a Chinese court
directed the Chinese search engine Baidu.com to
stop directing users to illegal music-download
sites.
Given the terrorist-funding angle,
the Indian Commerce Ministry's new efforts to
tackle piracy ought to push for criminal laws
against buyers of pirated goods, rather than just
the pirates. To kill the supply requires killing
demand, and middle-class sensibilities might like
buying pirated offerings less if it meant the risk
of a ride in a police van.
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