What the future holds for anti-counterfeit market in India?

A few decades back, flaunting a Converse Sneaker was a luxury which very few could afford. Today, street side markets are flooded with its strikingly similar copies, available in every size and colour. Over a period of time, the presence of fake items has become rampant across different sectors and has plummeted brand value. It is often infuriating to see an identical copy of your costly Louis Vuitton bag hanging outside a local shop. This makes you wonder about the susceptibility of a brand to counterfeiting. More to it, you regret about the hefty amount you spent to purchase the designer bag as its fake version is already available in the market. No doubt, the menace of counterfeiting destroys brand value, dupes the consumers and negatively impacts the economy.

The counterfeiting market in India has grown exponentially over the last decade. According to Authentication Solution Providers’ Association (ASPA), a non-profit organization against counterfeiting, “The market for fakes are on a constant rise and has surpassed over a staggering Rs 40,000 crores in the organized sector alone.” The figure is certainly a wakeup call for Indian economy which suffers due to weak law enforcement and rare use of security technology by industries. In addition, the penetrating e-commerce market is also facing a similar wrath further aggravating the problem. However, manufacturers across different sectors are seeking solutions to save their products and consumers from counterfeiting, though according to ASPA, the implementation of anti-counterfeiting solutions is not even 2 per cent in the current scenario.

Riding high on the wave of ‘Make in India’ industries must ensure stringent anti-counterfeiting measures for an impeccable growth. According to an article published in New Indian Express, the anti-counterfeiting industry is worth Rs 2000 crore and is growing annually at 15-20 per cent. As different regulatory bodies in India and abroad are laying down rules to deal with counterfeiting, it is high time that manufacturers realize the importance of security holograms, application-based verification, bar coding, security labels and other anti-counterfeiting solutions.

While speaking at a recent Anti-Counterfeiting and Brand Protection summit, Union Commerce & Industry Minister Mr. Suresh Prabhu emphasized on fortifying the Intellectual Property Rights (IPR) so that multinational and national companies which are going to invest in brand building, can get cover under IPR protection. But, the situation is quite bleak when it comes to usage of modern anti-counterfeiting technology. According to a report by Grant Thornton, “The state of anti-counterfeiting solutions also needs to be modernized. The ASPA is of the view that India is at least 10 years behind in enforcing anti-counterfeiting measures compared to western countries.” The report further states, “For manufacturers, adopting authentication tools such as holograms, watermarks, security inks and substrates, code-based digital tracking etc. is imperative.”

A recent example is the application of digital authentication apps by pharmaceutical companies. According to the World Health Organization (WHO), India accounts for 35 per cent of the fake drugs sold worldwide. But, with the use of authentication technology users can send images of the drugs available online and can detect the authenticity of the seller, this will considerably bring down the sale of fake drugs in the market in the coming future. A more recent example is the adoption of QR code security by government undertakings. The QR code is embedded in the packaging which can be scanned through a QR code application to detect the authenticity of the product. With an impetus provided by the development of anti-counterfeiting technology and stricter law enforcement, there is going to be a massive potential for the anti-counterfeiting industry in India.