In the Brexit phase Indian industry including pharmaceuticals will need to capitalize on the falling value of British currency to invest and acquire companies in UK, according to experts.
 
With UK coming out of EU, growth prospects of the global economy are dented. Strengthening of the rupee against the GBP leads to de-acceleration of foreign direct investment from UK to India.
 
Kaushik Desai, secretary, Indian Pharmaceutical Association and pharma consultant said that while it is too early to assess the Brexit impact, the future depended on how the synergy between MHRA and EMA unfolded. Companies will need to re-draft business plans. Devaluation of GBP mars exports to the UK for MHRA approved products. Therefore, exploring joint ventures in the UK was the way forward.
 
In order to have a better perspective on Brexit, Bangalore Chamber of Industry and Commerce organised a seminar. Although there was no specific impacts shared for the pharma industry, Parthasarathi Shome, chairman, ITRAF & head of research committee said, “The world was not ready for Britain to depart from the EU. Everything with regard to valuation is now impacted. Currently, India ranks 13th as UK’s trade partner. Our country should bolster imports from UK than from China. To thrive with ‘Make in India’ programme, we should access UK’s technical expertise as this external infusion would give a fillip to our manufacturing capability”.
 
“India is the second biggest source of FDI for UK. Indian companies that would set up production plants in the UK could sell their products to the rest of Europe under the EU free market system. With Britain out of EU, the fear is that the latter could no longer be an attractive destination for Indian FDI. However, UK would also not want to lose out on capital coming in from India. Thus, one can expect, UK to woo Indian investments by providing tax breaks, lesser regulations and other incentives,” noted Thyagu Valliappa, president, BCIC.
 
Delving on Brexit for IT industry which is also a knowledge driven sector like pharmaceuticals, Krishnakumar Natarajan, executive chairman, Mindtree said that risk on revenues was huge. Companies would need to restructure business models since UK was the EU operation headquarters. Both customer and talent migration are looming large. However, key positives in the long term are the new processes that would draw up opportunities for Indian IT and this industry will benefit significantly from collaboration with UK in the field of artificial intelligence.
 
Following the BCIC statements on Brexit, pharma industry experts said that it was the right time for Indian drug companies to acquire facilities or even enter into partnerships to take advantage of the fall of GBP.