Basmati Rice Case Study

BASMATI RICE CASE STUDY

Widnall D’souza1, Department of Global MBA, School of Management, Manipal

Abstract: Basmati rice is one of the important and popular grain crops of India. Basmati is one of the most well-known and internationally recognized geographic implication that come from indian sub-continent. [1] The increasing population loses the aspect of basmati rice and has specific effect on the revenue of rice, so the proper analysis of basmati rice form is very important. This type of rice has been grown in the foothills of the Himalayas for thousands of years. This is a long-grained rice with a fine texture is the high priced rice in the world and has been recommended by emperors and praised by poets for hundreds of years.The American company, RiceTec Inc granted a patent in September, 1997 to challenge indian government and has been trying to enter international basmati market. The fresh discussion over the granting of patenting rights to three new pressure of Basmati rice by the US Patent and Trademark Office is used as a case study to inspect the impact of incomplete protection of intellectual property. Results suggest that there is indication that the introduction of a competing product that may impose on India’s geographical indicator has harmed Indian producers in key export markets. if  the patent is not revoked, RiceTec Inc., can now sell its rice under the brand name Basmati which will easily cut into India’s and Pakistan’s global market share, especially as the rice grown in the US could be sold low priced than the Indian and Pakistani varieties.

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1. FACTS:

• Originally  from  India  and Pakistan, Basmati became  a  doubtful  ‘issue’  after RiceTec, a Texas-based  company,  in  1997, patented  some  types  of  rice  they leading  as  “American basmati”

• [1]RiceTec  Inc,  had  been  trying  to  get in  the  international  Basmati market  with  brands  like “Kasmati” and “Texmati”. lastly, the company claimed to have leading a new tension of fragrant rice by interbreeding basmati with adding variety. They required to call the supposedly new variety as Texmati or American Basmati.
•  RiceTec  Inc, was  published  the  Patent  number 5663484 on  Basmati  rice  lines  and  grains  on September 2, 1997.
• This was objected  to by  two  Indian nongovernmental organizations  (NGOs)— Centre  for Food  security,  an  international  NGO  that  aggressive  against  bio piracy,  and  the  Research Foundation for Science, Technology and Ecology, an Indian environmental NGO who recorded proper application in the united states. The center for scientific and industrial Research also objected it.
• They sought trade protection for basmati rice of the Indian subcontinent and jasmine rice of Thailand.  They wanted alteration of  U.S.  rice  standards  to  identify  that  the  term “basmati” can be used only  for  rice grown  in  India and Pakistan, and  jasmine  for  the Thai rice.  
•  The Indian government, after putting together the evidence, formally challenged the patent in June 2000.
• The patent was  challenged on  the  detail  that  the plant varieties  and grains  already  exist  as  a main in India. 75 percent of U.S. rice imports are from Thailand and that the rest is from India and Pakistan and both varieties are rice that cannot be grown in the United States.

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1. Legal concept:

Basmati,is “perfumed one,” is a high-quality, long-grain, semidwarf rice that has been grown in the foothills of the Himalayas for thousands of years. Basmati rice requires deep, fertile soil, a cool climate and a short photoperiod. As such it is difficult to grow Basmati rice for commercial purposes in other areas. Nonetheless, a Texas rice development company, RiceTec, Inc. (RiceTec) began producing and exporting a Basmati-type rice it called “Texmati” in 1985, long before TRIPS.

The law firm describing India in the controversy, Sagar and Suri, criticized the procedures for allocating patents in the US justifying it is opposite to the one followed in India and Europe. According to them, India first considering a patent application, then generally disclose it for third parties to challenge, and only then allocate the patent. However, the US keeps the patent application a nearly guarded secret and allocate it without permitting other parties to challenge it. After the patent has been allocated, third parties are then permitted to application in contradiction of the patent as India is presently doing in the Basmati case. This criticism obviously demonstrates the deficits in the patent procedure in the US that eventually needs to be reviewed to avoid future cases like this from happening

It is been claimed that the US has allowed a patent to basmati to American company Rice Tec and that this would hit our export of this grain, high premium, perfumed rice variety that is grown by about 300000 farmers in Haryana, western Uttar Pradesh and Punjab. Unluckily facts are at deep discount. The problem just in the US there is no dispute in Europe and west Asia. About 10 percent of our basmati rice exports go to the US.

         The type of quantity being used is accusing the Rice Tec  Inc and the US of violating the Geographical indication act of the TRIPS agreement in the WTO. But first, India and Pakistan would file a request to the US patent office to re-examine the patent on Basmati requesting Basmati has grown in their areas for thousands of years and is common knowledge in India and thus cannot be patented.

The TRIPS agreement, which seeks global harmonization of intellectual property (IP) laws, came into effect in 1995. All countries that are members of the World Trade Organization (WTO) are required to follow the TRIPS guidelines to adopt common global laws for protection of intellectual property or face the risk of trade sanctions (WTO 2011). Developing countries often argue that

Of the 40 cases filed, India has been successful in winning 15 cases around the world including in the UK, Brazil, Greece, Australia, France, Spain, Chile and UAE. In Spain, APEDA has been successful in obtaining a registered trademark for Basmati rice as aromatic rice produced in the sub-continent, thus deterring non-Indian food companies from using Basmati as a brand name. In Brazil, India has been able to overturn an application for using Basmati as a trademark for sweets and condiments. India has also been successful in two othercases against RiceTec in Greece and the UK (Nilacharal 2001).