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[Editor's note: Please note that there was an error and Meerut Scissors have not been granted GI status yet. The cause for confusion and correction has been noted in this post here]
GI to Meerut scissor manufacturers, intellectual property facilitation centers – welcome changes for the MSMEs
Recently (and for the first time), a handmade tool from a micro and small scale industry (MSME) in Meerut, India, has been given the tag of a geographical indicator (GI) (available here). The tool is a pair of scissors made by a community in Meerut who have been making these scissors for more than three centuries. The first such scissor was made 360 years ago! The scissors are essentially made of metal scrap and sizes vary from 6 inches to 14 inches. The metal scrap used is sourced from used cars, buses, trucks and railways. The whole community, including women, is engaged in the activity of making these scissors and it is reported that these scissors are in high demand in the domestic market.
This is a welcome decision for the small and micro industries of India and the informal sector. Given that many of products of the informal market are of traditional and cultural lineage, maybe we will see geographical indicators being granted to them thus ensuring that the benefits of intellectual property rights permeate into the unorganized sector of the Indian economy.
The impact of GIs on the socio-economic development of the smaller sectors of the organized economy as well as the informal sector of the Indian economy is tremendous. GIs are signs that recognize the link between the reputation, quality and geographical origin of the product. These linkages inform producers and consumers of the quality of the product thereby distinguishing that product from any other. This distinction, in a way, bridges the informational asymmetry that exists in the market and protects the products of the informal sector/MSMEs from unfair competition. This distinction also enables greater market access thereby leading to higher income by higher volumes of sale. Not only is market access increased, but as studies show, since embedded in a GI are the economic, social and cultural values of the local community, their attractiveness and demand increases. This in turn results in value creation and payment of premiums – as observed “studies include willingness to pay surveys which have found that 43 percent of consumers in the EU are willing to pay a 10% premium for a product with GI labelling, while 8% of EU consumers have indicated a willingness to pay a 20% premium (Berenguer, 2004)”. In addition to this, GIs impact development of the rural sector, by increasing employment, investment, etc. as evidenced by – “for example it has been found that the Comte GI and the increase in demand for the product have improved the agricultural employment opportunities in the region (ETEPS, 2006 as cited by Requillart, 2007)”. Also, since GI are not restricted to individuals but can also extend to entire communities through registered associations, they are a boon to local and regional business.
These impacts and results have been evidenced in several GIs that have been granted in India. For example, Muga Silk of Assam, which was granted GI protection in 2007 (Application No. 55, Handicraft, State: Assam, Registration Details of GI Applications 2003-2012), now has a booming demand. This silk is often referred to as the ‘magic silk of Assam’ and is the rarest silk, available only in Assam(for more about Muga Silk see here). As reported (here) “After wooing customers in the US, Europe and West Asia, Assam’s famous Muga silk is fast gaining popularity in Japan which may eventually emerge as the biggest market for the thread… Demand for Muga, which has got GI Registration in 2007, is high in the international market since Assam is the sole producer of this rarest of rare fine”.
Similarly, Jaipur’s famous blue pottery, was given GI protection between 2008-2009 (Application No. 66, Handicraft, State: Rajasthan, Registration Details of GI Applications 2003-2012), and since then it has expanded vastly. As observed by Jitinder Yadav (here), a blue pottery manufacturer in Jaipur, “Earlier there were just 20 manufacturing units while today the industry is 250 strong.” It was also stated that exports have grown and blue pottery is now exported to Denmark, Egypt, US, Australia, UK. Moreover, at the time when GI protection was given, the blue pottery manufacturers were confident that such protection would enhance the growth of this skill and trade (available here).
This shows that GI’s can be a tool to enhance protection and advancement of the interests of the small scale and maybe even the informal sector of the Indian economy. In furtherance of this end, The Federation of Indian Micro and Small and Medium Enterprises (FISME) is planning to set up an intellectual property facilitation (IPF) at Bangalore, Hyderabad and New Delhi (available here). These centers will primarily disseminate knowledge about GI protection and provide technical and legal advice to MSME’s with regard to the process etc. of obtaining such protection. This initiative has been taken with the larger purpose of ensuring easier and more numerous GIs for MSMEs
 See Cerkia Bramley, A review of the socio-economic impact of geographical indications: considerations for the developing world, (Paper prepared for presentation at the WIPO Worldwide Symposium on Geographical Indications June 22 – 24 2011, Lima, Peru).