Tanaz Buhariwalla, India Director, IDA Ireland informs that India and Ireland’s economic and trade ties are growing year on year and highlights that bilateral trade between India and Ireland stood at €1.116 billion from January-December 2019, the highest recorded turnover between any two countries. She also talks about why Ireland is the next ‘speak-to country’ for India, post-Brexit for companies focussed on growing their European market, in an interview with Lakshmipriya Nair
What are the opportunities that have opened up for India-Ireland collaborations as a result of the COVID-19 pandemic?
It is said that every adversity brings with it the seed of an equal or greater benefit and while COVID-19 has thrown a cloud over the global economy, we have seen numerous opportunities open up between India and Ireland during this time. Most of these are in the life sciences and technology sectors. With the disruption to their supply chain affecting Indian companies, the importance of having a presence in Europe to ensure the security of supply in the future is now in focus. We are in discussion with a number of them who are evaluating the option of setting up a presence in Ireland. This also includes Indian companies offering digital products and aiding digital transformation projects for clients in the West.
In a post-Brexit world, Ireland remains the only English-speaking country in the EU, with a supportive and pro-business government. The Irish government’s support to individuals and businesses in the form of unemployment payment to those who had lost jobs, wage subsidies for employers and low-interest credits for micro-businesses were also availed by Indian companies, professionals and students in Ireland.
The initiative of the Irish government in launching a coordinated RD&I funding opened up opportunities for companies from India and other countries looking to collaborate for these R&D projects with large-scale process and technology optimisation for commercialisation. These included improving the speed of COVID-19 testing; developing rapid tests for COVID-19 antibodies; developing novel disinfection approach or novel antimicrobial wipes; collaborating for COVID-19 vaccine technology and more.
Irish companies from sectors such as life sciences, medtech, diary, engineering especially hi-tech hardware, SAAS companies and fintech and edtech companies are also looking at entering and servicing the Indian market. There are over 110 Irish companies in India, including the Kerry Group, Taoglas, ICON, and Glanbia. Some Irish companies like Novaerus (a high-end air purification company) are getting a lot of traction due to COVID-19.
Which are the major areas where India and Ireland can collaborate in the healthcare and pharma sectors? What do these countries have to offer each other?
There is a significant demand for skilled healthcare workers in Ireland. In the early days of the pandemic, PM Modi spoke to the then Irish PM, Leo Varadkar, and the discussions included joint collaborations in life sciences. PM Varadkar also praised the role played by the Indian nurses and doctors in the Irish healthcare system, through the pandemic. According to the Nursing and Midwifery Board data (2018-19), over 6,000 Indian-origin nurses are registered in Ireland, which is about nine per cent of the total nurses in the country. Apart from this, there are likely 250 senior medical consultants and around 400-500 junior doctors in Ireland from India. A good number of these work as frontline staff in various establishments throughout Ireland.
In the life sciences sector, Ireland is a European manufacturing base for many global biopharma companies with primarily supply chain linkages in India, China and other South-East countries. Many Indian companies faced logistical disruption during the pandemic that interrupted their supply to European manufacturing facilities. We are in discussion with a number of such companies who are evaluating the option of setting up a presence in Ireland to maintain an agile supply chain closer to the actual user in the value chain.
Ireland provides the perfect ecosystem to develop cost-effective technology solutions and many healthcare multinationals have used Ireland as an innovation lab to demonstrate their IoT-based technologies and product offering. Ireland is the perfect destination for biopharma and medtech companies who are looking to move up the value chain by building products for the future.
How much of IDA Ireland’s business comes from India? How has it grown over the years? What is the share that comes from healthcare and pharma companies?
IDA Ireland closely engages with Indian companies to understand their business plans for Europe and we work with them on their journey to growth in Europe through a successful presence in Ireland. IDA Ireland in India has played a vital role in the European investment journey of many Indian companies including TCS, Infosys, Wipro, Tech Mahindra, Tata Motors – Jaguar Land Rover, HCL, Wockhardt, NIIT, BrowserStack and Sahajanand Medical Technologies to name a few. At present, about 70 Indian companies have a presence in Ireland and there are about 110 Irish companies in India, with about 60 having an on-ground presence. Both numbers are rapidly rising.
Ireland leads in the life sciences sector, with all leading global pharma and medtech companies having a large presence in Ireland. The Indian companies include Wockhardt, Sahajanand Medical Technologies, Unichem, Intas, Bio-tech Vision Care and many others in areas ranging from manufacturing to warehousing and distribution and R&D.
In terms of trade statistics, bilateral trade stood at €1.116 billion (Jan-Dec 2019). An analysis of data available for the period Jan-Dec 2019 shows that this is the highest ever recorded turnover in the bilateral trade and economic relations between the two countries (up 25.92 per cent from the previous year). These figures reaffirm the strong economic and trade ties which are growing year on year. Major items of exports from India are chemicals, textiles, pharma, scientific equipment and rubber. India mainly imports IT devices, plastics, pharma products, scientific and medical equipment from Ireland.
What makes Ireland, ‘the’ destination for Indian companies looking to enter or expand in the EU markets, especially after Brexit? What are the unique advantages it offers to these companies?
At IDA Ireland, we work with the world’s most innovative and sophisticated high-growth companies across sectors nurturing and helping them forge their future success in Ireland. We are doing this for over 70 years and Ireland’s performance as a hub for FDI is unrivalled. Sectors thriving in Ireland include biopharma, medical devices, financial services, technology and internet-based companies, manufacturing and engineering including the future mobility sector.
Ireland is one of the most globalised countries in the world. Most of the multinational giants in life sciences, technology, financial services and other sectors have their global/European headquarters in Ireland. These are for reasons of its membership of the EU, availability of highly skilled workforce, common law, the prevalence of English language, low 12.5 per cent corporate tax and pro-enterprise government policy.
With its strategic positioning, Ireland is the next ‘speak-to country’ for India, post-Brexit, for leveraging its business interests in the EU institutional platforms. There exists a strong Double Taxation Treaty between the two countries and direct flights between main cities of the two countries are in the pipeline. There are a number of Indian companies who are evaluating Brexit related relocation, and in Ireland, they will be joining a long list of other global and Indian companies that are successfully operating for many years now.
Ireland offers a very conducive ecosystem for firms focussed on growing their European market. The large presence of US multinationals in Ireland proves to be one of the attractive reasons for Indian start-ups targeting those companies. Moreover, the geographic proximity with the US compared to other EU countries makes Ireland a hotbed for such companies.
For the regulated sector like the life sciences and financial services sector, Brexit relocation is a major decision to make. While the EU legal framework is applicable until the end of the transition period, from January 2021, companies must have established an entity in both the UK and EU to continue operating in both markets. The future of the life sciences industry in both locations will be determined through legislation passed by, and agreements reached between, the two during the transition period. If no legislation is passed and no agreement is reached, the life sciences industry will face something akin to a “no-deal” Brexit scenario affecting free movement of goods and people. Present indications hint at exactly such a scenario, at a hard, no-deal Brexit.
In this scenario, Ireland becomes the preferred option for both, regulated and non-regulated sectors looking to service the EU and US. My team and I are working with and handling an increased number of queries from the life sciences companies in India as a direct effect of Brexit. These are companies revisiting their EU strategies and want to understand the Irish proposition better especially given Ireland’s commitment to the EU, the ease of doing business environment, low bureaucracy, the R&D tax credits, attractive corporate tax rates and low talent costs among other factors.
Tell us how the business and regulatory landscape in Ireland is conducive for Indian bio/pharma and healthcare companies/start-ups?
Ireland is amongst the world’s largest net exporter of pharma products and a globally recognised centre of excellence in pharma and medtech. It is home to 10 of the world’s top 10 pharma companies that include Novartis, Pfizer, Roche, Sanofi, Merck & Co, J&J, GSK, Gilead, Abbvie and Amgen. While traditionally, Ireland has maintained a strong cluster in small molecule pharma manufacturing, the last decade has seen a huge growth in biologics manufacturing sites and a diverse range of international services activities.
Many biopharma multinationals have established their commercial, finance and treasury centres in Ireland along with international supply chain and technical operations like regulatory affairs, pharmacovigilance, pharmacoeconomics operations, medical support, medical writing and managing patient assistance programmes etc. Ireland is also at the forefront of developments in the rapidly evolving biological treatment sector including advanced therapy medicinal products (ATMPs) like cell therapy, gene therapy, antibody-drug conjugates and complex mAbs.
Indian companies in the generic and biosimilar industry have various incentives to do the initial development work followed by manufacturing and distribution through Ireland. One of the key incentives for incremental innovation in Ireland was the introduction of Knowledge Development Box (KDB). This gives an effective 6.25 per cent corporate tax rate on qualifying profits derived from qualifying intellectual property (IP) that includes process or product patented inventions or copyrighted software, that results from R&D activities and has various applications in clinical research organisation’s (CRO), documentation and regulatory submissions.
Ireland has an excellent track record in terms of compliance with statutory and quality regulations. Mutual Recognition Agreement between the US and the EU (including Ireland’s Health Products Regulatory Authority i.e. HPRA), permits in most cases, Irish manufacturing site with a HPRA clearance to sell their products in the US. This gives an added incentive to generic and biosimilar companies to manufacture their product in Ireland.
Indian life science companies that are moving up the value chain in biotech research and hi-tech sophisticated medtech product development can find a well-developed ecosystem with stable regulatory environment, an opportunity to rub shoulders with the large multinationals and most important, a gateway to Europe and other international markets.
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