Post Brexit Era: The Roadmap For Indian Pharma Inc.

Post-Brexit, a strategic realignment can help India emerge as a significant partner for pharmaceuticals in the both the EU and the UK

- Usha Sharma And Lakshmipriya Nair

Britain’s decision to break away from the European Union (EU) plunged the world into uncertainty and turbulence as evidenced by the plummeting global financial markets, fear of an economic slowdown, political turbulence and increasing clamour among other member nations such as France to exit EU.

Its ripple effects have been felt in India too. As a knee jerk reaction to the referendum's result, share prices of various leading Indian firms with sizeable businesses in the UK took a severe hit (Check table 1). Predictably so, as our ties with the EU and the UK have grown considerably in the past few years. India's bilateral trade with the UK stood at at $14.02 billion in 2015-16, of which, exports contributed $8.83 billion while $5.19 came from imports. (Source: Commerce and Industry Ministry). India has emerged as the third largest investor in terms of number of projects in the UK. The total turnover of Indian businesses from the UK has grown from £22 billion in 2014 to £26 billion in 2015. 

Yet, the sentiments have undergone a significant change. The immediate panic has given way to cautious optimism, especially for certain sectors like pharma. The stock markets have rallied around and experts foresee several silver linings for India's growth. Sectors like IT and automobiles may have to face some adverse effects, but the pharma sector seems to be insulated against the fallout of Brexit.

Bucking the trend