Risks for a UK pharmaceutical firm entering India's market
This paper is going to critically evaluate the risks which associate with many aspects that a business will have to cope with when expanding into an international market. In more detail, this case is about a pharmaceutical company, from the UK, which desires to develop its production in India. The paper is structured into four main parts which demonstrate risks in cross-cultural, political, financial and commercial presence. Finally, a conclusion and recommendation will be drawn upon exploring and analyzing the context.
India is the seventh largest country in the world, covering around 3.29 million square kilometres. The country’s population is the second highest in the world with more than 1.2 billion people (CIA, 2013). The aforementioned two characteristics of India are extremely attractive to any business, especially businesses that have a sufficiently strong base for dealing with a huge and demanding market. The relationship between the UK and India is very healthy and sustainable. In 2011 India was the UK’s largest non-EU market (UKTI, 2012a). Especially, figures from December 2011, Indian Pharmaceutical Industry has grown at 15.7% (UKTI, 2012b). However, before dreaming of any benefit, the firm must consider carefully every aspect of India for a fruitful future and with a right mindset and an adequate diligence then the company could be highly prosperous on its solid position in India.
Cross-cultural risks
Regarding cross-cultural risks, there are three main aspects that should be considered are: cultural differences, negotiation pattern and ethical practices.
With respect to cultural differences, there are many contrasts in cultural elements. It is recommended that not only an expanding pharmaceutical firm but also all foreign companies need to concern about: the language and the Hinduism.
The root of the diversities in culture is the India’s enormous population which consists of two large ethnic groups which are 80 percent Hindus, 12 percent
India is the seventh largest country in the world, covering around 3.29 million square kilometres. The country’s population is the second highest in the world with more than 1.2 billion people (CIA, 2013). The aforementioned two characteristics of India are extremely attractive to any business, especially businesses that have a sufficiently strong base for dealing with a huge and demanding market. The relationship between the UK and India is very healthy and sustainable. In 2011 India was the UK’s largest non-EU market (UKTI, 2012a). Especially, figures from December 2011, Indian Pharmaceutical Industry has grown at 15.7% (UKTI, 2012b). However, before dreaming of any benefit, the firm must consider carefully every aspect of India for a fruitful future and with a right mindset and an adequate diligence then the company could be highly prosperous on its solid position in India.
Cross-cultural risks
Regarding cross-cultural risks, there are three main aspects that should be considered are: cultural differences, negotiation pattern and ethical practices.
With respect to cultural differences, there are many contrasts in cultural elements. It is recommended that not only an expanding pharmaceutical firm but also all foreign companies need to concern about: the language and the Hinduism.
The root of the diversities in culture is the India’s enormous population which consists of two large ethnic groups which are 80 percent Hindus, 12 percent