The Agreement on Trade-Related Intellectual Property Rights (TRIPS) was negotiated between 1986 and 1994 as part of the Uruguay Round of the General Agreement on Tariffs and Trade (GATT), which led to the creation of the World Trade Organization (WTO). The TRIPS agreement sets minimum levels for different types of intellectual property protection, including copyright, trademarks, patents, industrial design and trade secret protection. WTO membership implies an obligation to respect the TRIPS agreement. According to the WTO, the agreement seeks to strike a balance between long-term social benefits to society through increased innovation and short-term costs to society due to lack of access to inventions (World Trade Organization: Intellectual Property: Protection and Enforcement. Appeal of the WTO agreement: agreements: wto.org/english/thewto_e/whatis_e/tif_e/agrm7_e.htm). Unlike other IP agreements, TRIPS have an effective enforcement mechanism. States can be disciplined by the WTO dispute settlement mechanism. The revision of patent legislation has put in place a stronger patent protection mechanism, in line with international standards or the standards set out in the agreement. The result was positive for India, as foreign investors were encouraged to invest in India. Domestic investments can be expected not to respond to the stricter patent system, but foreign direct investment (FDI) could do so. In addition, research and development spending (R-D) by national actors increased significantly in the period following the agreement compared to the period prior to the agreement.
India became a party to the TRIPS agreement in 1994, but the agreement entered into force on 1 January 1995 and was designated in the global scenario as the most important multilateral IP agreement. By establishing minimum standards for intellectual property rights at the international level, the agreement promotes trade and technology transfer between countries. The 1970 Patent Act was contrary to Article 27 of the Agreement. In order to fully comply with the agreement, India had to take the necessary measures within the additional time frame. The agreement provided a three-step framework for strengthening the IP system in developing countries such as India, which did not allow product patents in the fields of medicines and agrochemicals (patent applications, also known as mailbox applications) prior to the agreement`s entry into force. These steps are described as follows: Article 27 of the agreement deals with patents, process patentability and inventions. The patentable object covered by the agreement represents inventions, whether products or processes, in all areas of technology, as long as they are new, involve an inventive/innovative approach and are industrially usable. However, the following countries are excluded from the scope of patentability: since the introduction of TRIPS, it has been criticized by developing countries, scientists and non-governmental organizations.