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United States has placed India, Pakistan, China and nine other countries on the top "priority watch list" with regard to violations of intellectual property rights.

America's trading partners on the Priority Watch List present the most significant concerns regarding insufficient IPR protection or enforcement, or otherwise limited market access for persons relying on intellectual property protection.

Twelve countries - India, Pakistan, China, Russia, Algeria, Argentina, Canada, Chile, Indonesia, Israel, Thailand and Venezuela - are on the Priority Watch List.

These countries will be the subject of particularly intense bilateral engagement during the coming year, the US Trade Representative said as it released its annual Special 301 Report on the adequacy and effectiveness of US trading partners' protection of IPR.

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"This year's Special 301 Report comes with a call to action for our trading partners.

"We are ready to work intensively with you to stop intellectual property theft that threatens IP-related jobs in the United States and other countries," said USTR, Ron Kirk.

"Today's report is a springboard for ambitious and collaborative partnerships in the coming year to strengthen protection for the innovation and creativity that drive jobs and exports for the United States and our partners around the world," Kirk said.

Noting that fighting IPR theft in overseas markets is critical to the livelihoods of the estimated 18 million Americans who work in intellectual property-intensive industries, USTR said the Special 301 Report provides a means for the United States to promote the protection and enforcement of IPR.

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This year, for the first time, USTR has issued an open invitation to all trading partners listed in the report to cooperatively develop action plans to resolve IPR issues of concern.

On India, the USTR recommended that India take steps to improve the efficiency of judicial proceedings, and strengthen its criminal enforcement regime, by encouraging the imposition of deterrent-level sentences for IPR violations and by giving prosecution of IPR offenses greater priority.

US encourages India to provide an effective system for protecting against unfair commercial use, as well as unauthorised disclosure, of undisclosed test and other data generated to obtain marketing approval for pharmaceutical and agricultural chemical products, the report said.

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Observing that India continued to make incremental progress in 2010 to address its IPR legislative, administrative, and enforcement issues, the report said improvements included the introduction of a Copyright Amendment Bill, which may assist in addressing some aspects of the widespread piracy of copyrighted materials on the internet.

"However, the bill may not fully implement the WIPO Internet Treaties. The United States encourages India to revise and enact these amendments, and to thereby bring India's copyright law into line with international standards," it said.

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"India has also developed a national IPR policy which should help focus the government's efforts to address widespread piracy and counterfeiting, including counterfeit medicines, effectively," it said, adding that some industries also report improved cooperation with enforcement officials of certain state governments.

"Nevertheless, India continues to have a weak legal framework, and ineffective overall IPR enforcement persists," it said.

The United States encourages India to take action on its draft optical disc law and generally to combat widespread optical disc piracy, the report said and recommended that India improves its IPR regime by providing for stronger patent protection.

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"Particular concerns have been raised regarding provisions of India's Patent Law that prohibit patents on certain chemical forms absent a showing of increased efficacy, thereby possibly limiting the patentability of potentially beneficial innovations, such as temperature-stable forms of a drug or new means of drug delivery," it said.

"India should also take additional steps to address its patent application backlog and to streamline its patent opposition proceedings," the report said.