Post in SPICY IP by Prashant Reddy (without going into legal aspects) are narrative of problems faced by SMEs in developing products for government agencies.
Babbar Wrecker is a manufacturer of car/ truck recovery units (LRV). Army came with a requirement for 7.5 ton LRV and small firm Babbar and large firm Ashok Leyland (AL) were among those that responded. Army suggested a combination using AL Chassis and Babbars super structure. The product submitted by AL-Babbar combination was accepted and orders started pouring in. Initially Babbar got a part of the cake and later it dried up with AL placing orders on others. These type of problems crop up for SME due to purchase practices such as:
1. Govt taking ownership of IP without created it.
2. Insistence on dealing with large firms to meet eligibility conditions.
3.Enforcing multiple vendor rule, forcing innovator to license to competitors.