NEW DELHI: INDIA'S Supreme Court has not only confirmed what everyone already knew, that surrogacy is a commercial industry in the country, but it also ruled that renting a womb is legal.

The judgment delivered by the apex court last week ends a drawn-out debate on the ethics concerning the practice.

The court gave the verdict in a case relating to a baby girl called Manji, born out of the sperm of a Japanese husband and an anonymous donor's egg implanted in the womb of an Indian surrogate mother in Anand town in Gujarat state.

Ever since her birth on July 25, the baby has been in a legal limbo because the Japanese couple - Mr Ikufumi Yamada, 45, and his wife Yuki Yamada, 41 - who had paid for the services of the surrogate mother, had divorced by then. While Mr Yamada wanted to keep the baby, his ex-wife did not want her any more.

The stamp of approval by the court on surrogacy comes at a time when the government has put online the long-awaited draft surrogacy laws, prepared by the Indian Council of Medical Research, and invited public comments.

The absence of surrogacy laws even when the country had become a 'hub for fertility tourism' had come in for criticism by experts.

Surrogacy is estimated to be a US$445 million (S$644 million) business in India.

The draft surrogacy Bill, called Assisted Reproductive Technology (Regulation) Bill 2008, which is expected to be tabled at the next parliamentary sitting, will help regulate India's assisted fertility market.

First, it makes clear that the child born out of surrogacy will remain the 'legitimate child' of the couple seeking the assisted reproductive technology even if they become separated or divorced.

The child's birth certificate will bear the names of the genetic parents.

Second, the proposed Bill also mandates foreigners seeking a surrogate in India to provide documentary proof that they would be able to take the child back to their country.

They must also appoint a local guardian who will be legally responsible for the surrogate till the child is handed over to its parents.

Such demands will avoid similar controversies like in baby Manji's case, where the baby's father had applied to adopt the child, but Indian laws do not allow adoption of a baby girl by single men.

Manji could also not be taken out of the country because her nationality could not be determined and the Japanese embassy in Delhi would not issue a visa to her without proper documentation from the Indian authorities.

The proposed Bill also mandates that both the couple or individual seeking surrogacy through the use of assisted reproductive technology, and the surrogate mother, 'shall enter into a surrogacy agreement which shall be legally enforceable''.

It also stipulates that the surrogate cannot also be the egg donor. She can be either the relative of a couple unable to have their own child or a professional who is paid for the pregnancy.

The Bill proposes that all expenses of the surrogate shall 'be borne by the couple or individual seeking surrogacy'. It adds: 'The surrogate mother may also receive monetary compensation from the couple or individual, as the case may be, for agreeing to act as such surrogate.'

Indian women reportedly earn at least 100,000 rupees (S$3,120) for each surrogate pregnancy, which they say helps them pay for their own children's education.

The enactment of the law would help address the problem of the 'international black market' in surrogacy, Dr Aniruddha Malpani of one of Mumbai's best-known infertility clinics, told The Straits Times.

'The surrogacy laws will give confidence to those who come to India for fertility treatment that they are well within the laws of the country and at the same time protect the rights of the surrogate mother and baby,' he added.

Dr Malpani had told The Straits Times in an earlier interview that several Singaporeans came to his clinic for infertility treatment, as it costs 'at least one-and-a-half times more in Singapore'.

As for baby Manji, India's Supreme Court has allowed the child's biological grandmother to approach the Indian government for travel documents to take the baby to Japan.

pjay@sph.com.sg