Rise of the Nordic warriors

The Baltic Sea Region (BSR), an investment network and a consortium of six countries, namely, Denmark, Estonia, Finland, Latvia, Lithuania and Sweden, is trying to attract Indian investment in industries like pharmaceuticals and information technology. Nandini Patwardhan reports

How many times have we spoken of Europe with respect to a few countries like UK, Germany, Italy and Switzerland only? However the fact of the matter remains that the European region as a whole, is a superset of these subsets. This is more than evident, when the topic of discussion is the great Indian pharma industry and its voracious appetite for acquisitions. Companies have been making their presence felt in the EU by acquiring other companies from the above mentioned countries; when in fact they can also make a backdoor entry to the region, through the BSR.

If we go by the World Economic Forum's statistics, the Finland, Sweden and Denmark have consistently been in the top five of the world's most competitive economies while Latvia, Estonia and Lithuania are Europe's fastest growing economies. The BSR has vast experience in international trade that also offers world class financial, educational and innovation facilities, while the record-breaking growth in the region's prosperity projects that its consumer markets are rapidly expanding.

Thus, having stayed for long in the shadow of these countries, now the BSR (the six countries in the region) is looking at creating a name for itself. Each country has a unique business opportunity to offer to the Indian pharma industry. While Finland may already boast of having the necessary infrastructure in place and the existence of MNCs, Denmark has the Medicon valley, which offers all that is required for pharma and biotech companies to thrive and succeed. Countries like Latvia and Lithuania, with their distinct Russian influence and long standing universities (which focus on molecular research) offer the twin benefits of R&D initiatives and a market place that can be a hub, from where Indian companies can cater to the entire Baltic market and other European countries, as well as access the Russian and other CIS nations.

"Countries under the BSR are in the top 12 for being most investor friendly in the world. They offer competencies that complement those of the Indian partners. Easy access to European markets, cost-effectiveness, highest rates of industrial production growth in Europe and high production efficiency based on ground breaking IT technology, equates to value for money for our partners," says Annika Rembe, Development Agency, BSR.

The BSR is today well positioned to become the global place for the Information and Communication Technology (ICT) sector . In the last two decades, various competitive brands such as Accenture Technology Solutions, Microlink, TDC, Telia Sonera, and TietoEnator have witnessed strong growth and have established head offices in the region. Also, Indian technology majors such as Tata Consultancy Service, Wipro, Shyam, and Sasken Communication Technologies have successfully invested in the region.

With strong biotech competencies united into a super cluster through the ScanBalt BioRegion initiative, the region has over 1000 biotech and life science companies with competitive brands like AstraZeneca, Leo Pharma, Lundbeck and Novo Nordisk. BSR has over 60 universities working in life science research, with growing opportunities in clinical trials and medical methodology.

BSR also offers tremendous opportunities from the engineering and automotive sector. Liberalisation of policies has brought tremendous benefits and has driven down costs in the region. Due to high R&D expenditure and world class standards of automotive and design, the region has seen record breaking production growth and successful trade relationship with companies such as ABB, Atlas Copco, Autoliv, Kone, Saab, Sandvik, SKF, Snaige, Volvo and Wartsila.

With a proven ability to attract and retain FDI, the BSR is all set to further strengthen its trade relationship with India. The region's governments have reduced bureaucratic obstacles and the BSR, as a collective force, operates strong pro-business policies, with close cooperation between the public and private sectors. This allows easy access to government officials and a more open, dynamic business environment.

This endeavour undertaken by the BSR investment network is to highlight the region as a cost-effective and highly productive destination for Indian majors and SMBs in the life sciences and IT sectors. While speaking on their intent to woo Indian companies, Rembe explained that with the changing economic times, globalisation and liberalisation, India has witnessed a series of cross-border investments. "Several Indian companies have expanded their global operations in various sectors across the world including the BSR. Companies such as Indorama, Wipro, Tata Consultancy Services, Larsen and Toubro, GlaxoSmithKline and Rheoscience have successfully invested in the region and are bearing the fruits of what the region offers them," she added.

Services offered

The consortium and the various country specific investment agencies (Invest in Finland, Invest in Sweden, Enterprise Estonia, Lithuanian Development Agency, Investment and Development Agency of Latvia-LIAA) are offering free consultation to the companies regarding setting up a new business, information and practice advice, arranging visit programs, and also in introducing to the government officials of the concerned nation. In addition to this, SEZs and ice-free ports in various countries in the region offer a host of advantages for new players, waiting to establish themselves there.

Thus, while the BSR may not be as big as the European Union, it can still help Indian companies in accessing and catering to the entire bigger market of Europe.

nandini.p@expressindia.com