Patent Pivot: Impact of India’s 2005 Patents Amendment using Synthetic DiD

This study evaluates the impact of India’s Patents (Amendment) Act, 2005, enacted to comply with the TRIPS agreement, on patenting activity. Using the Synthetic Difference-in-Differences (SDID) method, I construct a “Synthetic India” from countries with weaker pre-reform intellectual property regimes (Park Index, 2008). This approach refines pre-treatment alignment compared to standard Difference-in-Differences and Synthetic Control, enabling stronger causal inference. Analysis of WIPO patent data (1990–2015) shows a significant post-reform increase of approximately 3,266 patent applications annually, with results robust across bootstrap confidence intervals, placebo tests, and sensitivity checks. The reform spurred patenting particularly in pharmaceuticals, chemicals, and biotechnology while maintaining safeguards like Section 3(d), which prevents evergreening and preserves access to medicines. Findings demonstrate that TRIPS-compliant reforms can foster innovation in developing economies, but their effectiveness depends on balancing strong intellectual property rights with public-interest protections. India’s experience offers a model for countries navigating similar policy transitions.