India’s tech sector is witnessing a paradoxical trend: a surge in patent filings juxtaposed with a decline in patent grants. In the fiscal year 2025-26 (FY26), patent filings reached a record 1.43 lakh, marking a 30% increase from the previous year. However, the number of granted patents fell by 36%, highlighting a growing gap between applications and approvals. This development raises questions about the effectiveness of India’s intellectual property regime, particularly in the context of its burgeoning tech ecosystem.
### The Patent Bottleneck
The decline in patent grants is not merely a function of application quality but also a result of systemic issues. Section 3(k) of the Indian Patent Act poses significant challenges, especially for software-led innovations. This clause excludes certain software and algorithmic inventions from patentability unless they demonstrate a technical effect. Consequently, many applications are rejected or abandoned during the examination process.
Administrative hurdles further exacerbate the situation. A major restructuring within the patent office in FY24 initially cleared backlogs but also led to a temporary shortage of examiners. Although the government recruited 407 new examiners in early 2025, the impact of this hiring was not felt until late FY26, contributing to the lag in patent approvals.
### Disparity in Patent Filings
The disparity between academic and startup contributions to patent filings is another area of concern. Educational institutions accounted for nearly 55,000 patent applications in FY26, while startups lagged significantly with just over 4,000 filings. This imbalance suggests that India’s startup ecosystem may not be leveraging intellectual property as effectively as it could, potentially stunting deeptech innovation.
The tech sector, particularly in computer and electronics, saw the highest volume of applications but also faced a significant drop in approvals. Startups, in particular, struggled, receiving only 649 patents compared to over 14,200 granted to institutions. This scenario underscores the need for startups to enhance their understanding of patent requirements and align their innovations with patentability criteria.
### Future Implications
The current landscape poses critical questions about India’s readiness to become a global tech leader. While the surge in patent filings indicates a vibrant innovation environment, the decline in grants suggests that systemic reforms are necessary. A more responsive patent office and clearer guidelines on software patentability could help bridge the gap between filings and approvals.
Moving forward, addressing these challenges will be crucial for India to solidify its position as an innovation powerhouse. As new examiners settle into their roles and startups become more adept at navigating the patent landscape, there is potential for improvement in the grant-to-filing ratio. However, until these issues are resolved, India’s ambition to be a leader in deeptech and innovation remains a work in progress.
