The Confederation of Indian Industry (CII) presented a study titled Socio-Economic Impact of Piracy in the Publishing Sector to Secretary, higher education, ministry of human resource development, Mr Ashok Thakur on Wednesday. This is the first study in India that quantifies piracy in the publishing industry using econometric and other quantitative methods. The secretary lauded the efforts of industry in estimating the size and depth of the malaise and called for efforts to stem its growth. He laid focus on certainty of punishment for those who engage in illegal acts as well as developing greater awareness among students over copyright issues. The study highlights the fact that lower industry revenue leads to lower tax revenue for the government. It estimates that there was tax loss to the government of several crores in 2007-08. This has been steadily increasing over the past few years.
The study uses government data and statistical definitions as reference point and defines the market size of pirated books as a gap between the total expenditure on books by households including students and the supply of books in value terms. Among the sources of data used in the study to estimate the demand and supply of books in the market are data from National Sample Survey (NSS) of Ministry of Statistics and Programme Implementation (MoSPI), Annual Survey of Industries and Census of Micro, Small and Medium Enterprises (MSME).
On this occasion, Mr Thakur also stressed the importance of providing a competitive edge to workers of the Knowledge Process Outsourcing (KPO) industry which works in tandem with the publishing industry. He suggested CII to take the lead in setting up of centres at universities along with a Sector Skill Council which would provide skill-based training, thereby providing trained man-power to respective industries. He exhorted CII to work in coordination with the All India Council for Technical Education (AICTE) to build more industry participation inside technical institutes and universities to support the growth of such centres. He promised funding support from the government for such initiatives.
Among the major economic impacts of piracy, the study estimates loss of employment, loss to the government and impact on innovation and investments. The study quantifies the industry’s loss as a measure of revenue lost due to sales. Beyond the losses resulting from lost sales, there are related economic losses in the form of loss of employment due to reduced business activity in the legitimate market segment. Lesser revenue from sales means lowering of taxable income at the hands of the publishers, distributors, retailers as well as authors (as royalty income) — all of whom form part of the industry value chain.
The social impact of piracy includes curbing creativity, intellectual development and research. Publication of books carries forward the passion of knowledge creation and dissemination. Piracy hurts at the very core of this passion. It makes investment in creative information industries less profitable and more significantly often may lead to disenchantment among writers. Effects such as the presumed absence of publications that might otherwise have been created are inherently difficult to measure.
Essential to India’s emergence as a knowledge economy is the need to build an environment of intellectual curiosity and expression so that society is able to benefit from new thoughts and expressions manifested in books. Books and publications in turn help the drive towards innovation. Piracy of books impacts the very basis of intellectual growth and development. Lack of faith by the rights holder over their ability to make reasonable gains out of their labour could bring down the investment cycle in the sector at large.
Piracy also impacts education and learning. As found out during the course of study, pirated books are not just low in terms of their quality, but are also incomplete. As seen in the case of NCERT books, pirated versions often change the content or have pages missing. All this jeopardises the very reason why students buy those books.